Innovative Payment Solutions, Inc. - Quarter Report: 2015 April (Form 10-Q)

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Item 2. Management's Discussion and Analysis of Financial Conditions and Results of Operations.

The following discussion of our financial condition, changes in financial condition, plan of operations and results of operations should be read in conjunction with our unaudited interim financial statements for the three and six months ended April 30, 2015 and 2014, together with the notes thereto included in this Form 10-Q. The discussion contains forward-looking statements that involve risks, uncertainties and assumptions. Our actual results may differ materially from those anticipated in these forward-looking statements as a result of many factors.

Overview

Asiya Pearls, Inc. was incorporated under the laws of the State of Nevada on September 25, 2013. We are in the business of the online retail sale of high grade loose pearls which we intend to obtain from suppliers in Hyderabad, one of the major pearl centers in India. We intend to offer pearls to consumers in our online store. For orders, we will access the inventory maintained by our supplier. Our product line will consist of pearls of different sizes, colors and characteristics (drilled and whole). The concept is that our customers have their own jewelry designers who, with our pearls, will custom-make their jewelry. Our president has ample experience in online retail and our second director has experience in pearls and jewelry. We intend to sell these products through an internet website (the "Website"). Our website (www.asiyapearls.com) has been tested and is operational. Unfortunately we have received no orders for pearls as yet. We continue to hope we will get orders for pearls in the very near future as survival of our Company is dependent on these orders. We require approximately $15,000 for the next 12 months as a reporting issuer and we have a working capital of $9,504 and if additional funds become required before generation of revenue, the additional funding may come from equity financing from the sale of our common stock.  In the event we do not raise sufficient capital to implement its planned operations, your entire investment could be lost. Our office is located at the premises of our President, Shabbir Shaikh, who provides such space to us on a rent-free basis at H. 2434, Tengengar Galli, Belgaum, India.

The Company became a reporting company on March 11, 2014 after we had filed a prospectus that relates to the offering of a total of 5,000,000 shares of our common stock on a "self-underwritten" basis at a fixed price of $0.01 per share.

There have been no material reclassifications, mergers, consolidations or purchases or sales of any significant amount of assets not in the ordinary course of business since the date of incorporation. The Company has never been party to any bankruptcy, receivership or similar proceeding, nor has it undergone any material reclassification, merger, consolidation, purchase or sale of a significant amount of assets not in the ordinary course of business.

Our auditors have issued a going concern opinion. This means that there is substantial doubt that we can continue as an ongoing business for the next twelve months. This is because we have not generated any revenues and no revenues are anticipated.

Plan of Operation

About Our Company

Since our incorporation on September 25, 2013, our principal activities to date have consisted as follows:

a.

Registration of our domain name, initial funding by our two shareholders,

b.

We completed and tested our website and is operational. Unfortunately, today we have received no orders;

c.

In May 2014, we completed the sale of 5,000,000 common shares at the price of a $0.01 per share for total proceeds of $50,000.

d.

We conducted review of pearl suppliers and have verbally agreed to two suppliers that they will supply pearls whenever we receive orders and will pay them 50% of our price list as will be advertised on our website. We have developed a catalogue;

e.

We are listed on OTCBB under the symbol ASYP.

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During the first stages of our growth, Mr. Shaikh will provide all the labor required without compensation.  Since we intend to operate with very limited administrative support, Mr. Shaikh will continue to be responsible for at least the first year of operations.

We have no plans to change our planned business activities or to combine with another business, and we are not aware of any events or circumstances that might cause these plans to change.

Since we became a reporting company, we are responsible for filing various forms with the United States Securities and Exchange Commission (the “SEC”) such as Form 10-K and Form 10-Qs. The shareholders may read and copy any material filed by us with the SEC at the SEC’s Public Reference Room at 100 F Street N.W., Washington, DC, 20549.   The shareholders may obtain information on the operations of the Public Reference Room by calling the SEC at 1-800-SEC-0330.  The SEC maintains an Internet site that contains reports, proxy and information statements, and other information which we have filed electronically with the SEC by assessing the website at the following address:  http://www.sec.gov.

Results of Operations

We did not earn any revenues for the three and six months ended April 30, 2015 or April 30, 2014. We do not expect to realize any revenues until we are able to execute our business plan.

For the three months ended April 30, 2015, we have incurred total operating expenses in the amount of $2,825, mainly comprised of professional fees totaling $1,500 which relates to accounting fees; and general and administrative expenses totaling $1,325 which mainly relates to filing fees and travel.

For the three months ended April 30, 2014, we have incurred total operating expenses in the amount of $7,076, mainly comprised of professional fees totaling $6,538 which relates to legal and accounting fees for the registration statement and related costs.

For the six months ended April 30, 2015, we have incurred total operating expenses in the amount of $21,995, mainly comprised of professional fees totaling $18,578 which relates to trading eligibility, legal and accounting fees for the registration statement and related costs; and general and administrative expenses totaling $3,417 which mainly relates to transfer agent fees and travel for completion of the offering of $50,000.

For the six months ended April 30, 2014, we have incurred total operating expenses in the amount of $21,252, mainly comprises of professional fees totaling $19,693 and general and administrative expenses totaling $1,559 which mainly relates to legal and accounting fees for the registration statement and related costs.

We have not incurred any expenses for research and development since inception. As a result of operating losses, there has been no provision for the payment of income taxes from the date of inception.

Liquidity and Capital Resources

As at April 30, 2015, we had a cash balance of $10,074. If additional funds become required before generation of revenue, the additional funding may come from equity financing from the sale of our common stock.  

Our future financial results are also uncertain due to a number of factors, some of which are outside our control. These factors include, but are not limited to:

·

our ability to raise additional funding;

·

cost of development of our website;

·

interest by online users to purchase our products which will generate revenue from online sales.

Due to our lack of operating history and present inability to generate revenues, our auditors have stated their opinion that there currently exists a substantial doubt about our ability to continue as a going concern.

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Going Concern Consideration

The report of our independent registered public accounting firm for the period ended October 31, 2014 included a going concern paragraph because of a substantial doubt about our ability to continue as a going concern based on the absence of an established source of revenue, recurring losses from operations, and our need for additional financing in order to fund our operations in fiscal 2015.

Our operations and financial results are subject to various risks and uncertainties that could adversely affect our business, financial condition and results of operations.

Off-Balance Sheet Arrangements

We have no off-balance sheet arrangements including arrangements that would affect our liquidity, capital resources, market risk support and credit risk support or other benefits.

Forward Looking Statements

The information in this quarterly report contains forward-looking statements within the meaning of Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended (the “Exchange Act”). These forward-looking statements involve risks and uncertainties, including statements regarding the Company’s capital needs, business strategy and expectations. Any statements contained herein that are not statements of historical facts may be deemed to be forward-looking statements. In some cases, you can identify forward-looking statements by terminology such as “may,” “will,” “should,” “expect,” “plan,” “intend,” “anticipate,” “believe,” “estimate,” “predict,” “potential” or “continue,” the negative of such terms or other comparable terminology. Actual events or results may differ materially. In evaluating these statements, you should consider various factors, including the risks outlined from time to time, in other reports we file with the Securities and Exchange Commission (the “SEC”). These factors may cause our actual results to differ materially from any forward-looking statement. We disclaim any obligation to publicly update these statements, or disclose any difference between its actual results and those reflected in these statements. The information constitutes forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995.

Item 3. Qualitative and Quantitative Disclosure about Market Risks

We are a smaller reporting company as defined by Rule 12b-2 of the Securities Exchange Act of 1934 and are not required to provide the information under this item.

Item 4. Controls and Procedures.

Evaluation of Disclosure Controls and Procedures

Our Principal Executive Officer and Principal Financial Officer, after evaluating the effectiveness of our disclosure controls and procedures (as defined in Rule 13a-15(e) and 15d-15(e) under the Exchange Act) as of the end of the period covered by this report, have concluded that, based on the evaluation of these controls and procedures, that our disclosure controls and procedures were effective such that the material information included in the report is accumulated and communicated to our management, recorded, processed, summarized and reported within the time periods relating to our company, particularly during the period when this report was being prepared.

Controls and Procedures over Financial Reporting

Additionally, there were no changes in our internal controls over financial reporting or in other factors that could significantly affect these controls subsequent to the evaluation date.

Our management conducted an evaluation of the effectiveness of our internal control over financial reporting, as of October 31, 2014 and based on our evaluation under this framework, management concluded that our internal control over financial reporting was not effective as of the evaluation date due to the factors stated below.

Insufficient resources: We have an inadequate number of personnel with requisite expertise in the key functional areas of finance and accounting.

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Inadequate segregation of duties: We have an inadequate number of personnel to properly implement control procedures.

Lack of audit committee and outside directors on the Company’s board of directors: We do not have a functioning audit committee or outside directors on our board of directors, resulting in ineffective oversight in the establishment and monitoring of required internal controls and procedures.

Our management recognizes that there are inherent limitations in the effectiveness of any system of internal control, and accordingly, even effective internal control can provide only reasonable assurance with respect to financial statement preparation and may not prevent or detect material misstatements. In addition, effective internal control at a point in time may become ineffective in future periods because of changes in conditions or due to deterioration in the degree of compliance with our established policies and procedures.

PART II - OTHER INFORMATION

Item 1. Legal Proceedings.

The Company currently is not a party to any legal proceedings and, to the Company’s knowledge; no such proceedings are threatened or contemplated.

Item 1A. Risk Factors

We are a smaller reporting company as defined by Rule 12b-2 of the Securities Exchange Act of 1934 and are not required to provide the information under this item.

Item 2. Unregistered Sales of Equity Securities and Use of Proceeds.

None

Item 3. Default Upon Senior Securities.

None.

Item 4. Removed and Reserved.

Item 5. Other Information.

None.

Item 6. Exhibits and Reports on Form 8-K.

a. Exhibits

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SIGNATURES

In accordance with the requirements of the Exchange Act, the registrant caused this report to be signed on its behalf by the undersigned, thereto duly authorized.

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